Washington is moving to restrict U.S.-China capital flows. But there’s a trillion-dollar reason why this can’t go on forever.
Capital — accumulated money — is like water flowing down a hill. You can divert it but it often just ends up flowing elsewhere.
Credit: REUTERS/Brendan McDermid
The United States is taking more steps to limit Chinese investment and capital raising in America. Many are claiming this marks the start of a fundamental capital divide between the two nations, part of a broader decoupling of their relationship.
Whether or not this proves true is really not about any near-term restrictions. Instead, the real question is: what will become of the massive dollar capital flow from the U.S. to China?
To be sure, Washington seems to be cordoning off
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